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OFFICE OF J OB CORPS

BOSTON REGIONAL OFFICE PROCUREMENTOF JOB CORPS CENTER OPERATOR ANDSERVICE PROVIDERS IN PUERTO RICO

O f f i c e o f I n s p e c t o r G e n e r a l — O

f f i c e o f A u d i t

Date Issued: September 29, 2006Report Number: 26-06-002-01-370



U.S. Department of LaborOffice of Inspector GeneralOffice of Audit

BRIEFLY…Highlights of Report Number: 26-06-002-01-370,to the National Director of Job Corps.

WHY READ THE REPORTContracts for Job Corps center operators, outreachand admissions providers, and career transitionspecialists account for a majority of theapproximately $1.5 billion Job Corps annual budget.Procurement for those services is handled throughthe Regional Offices of Job Corps. A complaint wasfiled against the Boston Regional Office, alleging theoffice engaged in abusive procurement practicesthat resulted in the award of a contract with a 5-yearvalue of over $80 million on a noncompetitive basisin violation of Federal procurement laws andregulations.

WHY OIG DID THE AUDITOur audit objectives were to determine (1) if theallegations of procurement abuse brought againstthe Boston Regional Office were valid andsubstantiated, (2) whether there are any former DOLJob Corps employees working for the incumbentcontractor/offeror, and (3) whether the BostonRegional Office complied with applicable laws and

regulations in the procurement included in thehotline complaint.

READ THE FULL REPORTTo view the report, including the scope,methodology, and full agency response, go to:http://www.oig.dol.gov/public/reports/oa/26-06-002-01-370.pdf

September 2006

Boston Regional Office Procurement ofJob Corps Center Operator and ServiceProviders in Puerto Rico

WHAT OIG FOUNDWe found that the allegations were notsubstantiated. In addition, we did not find formerDOL Job Corps employees working for theincumbent contractor/offeror and the Regional Officecomplied with the intent of applicable laws andregulations, except for not promptly providingofferors who did not meet the competitive range thebasis for their being excluded from furtherconsideration for the contract.

WHAT OIG RECOMMENDEDWe recommended that the National Director of theOffice of Job Corps:• Update the Job Corps Procurement

Compendium to include the Federal AcquisitionRegulation requirement that the notice toofferors not meeting the competitive range is tobe provided “promptly.”

• Ensure the Regional Director of the BostonRegional Office of Job Corps issue writtenguidelines for the office to comply with theFederal Acquisition Regulation requirement topromptly provide an offeror whose score did notmeet the competitive range the basis for whythey were excluded from further considerationfor a contract.

The National Director of Job Corps responded thatthe agency concurred with the first recommendation.However, she stated that because contractingauthority was being transferred from the Job CorpsRegional Directors to OASAM Contracting Officers,the second recommendation is no longer applicable.She further stated that during scheduled training forthe OASAM Contracting Officers, the issuesidentified in the report will be emphasized.

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Boston Regional Office Procurement of Job Corps Center Operator and Service Providers in Puerto Rico

U.S. Department of Labor—Office of Inspector General 1Report Number: 26-06-002-01-370

Table of ContentsPAGE

EXECUTIVE SUMMARY ................................................................................................ 3

ASSISTANT INSPECTOR GENERAL’S REPORT ........................................................ 7

1. Allegations that the Boston Regional Office Used Abusive ProcurementPractices Were Not Valid and Not Substantiated ............................................8

2. Former Employees of Job Corps Are Not Working for the IncumbentContractor/Offeror for the Puerto Rico Job Corps Center ............................ 13

3. The Boston Regional Office Followed Applicable Procurement Laws andRegulations Except for Not Promptly Providing the Complainant/Offerorthe Basis for Explaining Why the Complainant/Offeror's Bid Did Not Meetthe Competitive Range and that the Complainant/Offeror Was No LongerBeing Considered for the Puerto Rico Job Corps Contract ......................... 13

APPENDICES............................................................................................................... 17

A. Background ...................................................................................................... 19

B. Objectives, Scope, Methodology and Criteria ............................................... 21

C. Acronyms and Abbreviations.......................................................................... 23

D. Agency Response ............................................................................................ 25




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U.S. Department of Labor—Office of Inspector General 3 Report Number: 26-06-002-01-370

Executive Summary

We completed an audit of allegations concerning the Request for Proposal to operatethree Puerto Rico Job Corps centers and outreach, admissions, and career transitionservices for Puerto Rico and the Virgin Islands. In January, 2006, the Request forProposal resulted in an $80 million contract award (two base years and three optionyears).

The complaint alleged Boston Regional Office Job Corps officials engaged in fiveabusive procurement practices that impacted the contract award. These were:

1. The Boston Regional Office Contracting Officer and Contract Specialist weretogether with executives of the Incumbent Contractor’s (offeror) at all times fromMay 3 through May 5, 2005 (Pre-Proposal conference and site visits) andtraveled with the executives in the same vehicles.

2. The Contracting Officer did not provide the answers to questions during the pre-proposal conference.

3. The Contracting Officer and Contract Specialist did not provide informationrequested by the complainant/offeror’s that the complainant/offeror believed to bereleasable under FOIA.

4. The complainant/offeror was not allowed an administrative hearing (after thecomplainant/offeror’s offer was rejected) and information regarding the priceoffered by the competition was withheld from the complainant/offeror.

5 The Boston Regional Office did not provide the complainant/offeror anexplanation of how the competitive range was established and information aboutthe competitive range.

Based on the above allegations, we developed an audit objective to determine whetherthe Regional Office used abusive procurement practices as alleged in the complaint. Inaddition to our objective regarding the five allegations, we added an objective to answerthe complainant’s question of whether there are any former Department of Labor JobCorps employees working for the incumbent contractor/offeror. As part of our work indetermining whether the allegations were valid, we included an objective to determinewhether the procurement process and award of the contract in January, 2006, compliedwith applicable procurement laws and regulations. We limited our audit to the specificprocurement identified in the allegation and, therefore, did not audit all procurementactions of the Boston Regional Office.





Results

Based on the fact the five allegations were not substantiated, we found the BostonRegional Office did not use abusive procurement practices related to those allegationsin procuring the services for the Puerto Rico contract.

In addition, we did not find evidence that former employees of Job Corps are working forthe incumbent contractor/offeror.

Overall, we concluded the Boston Regional Office complied with the intent of applicableprocurement laws and regulations. However, we identified the following areas of theFederal Acquisition Regulation (FAR) for which improvement in the office’s proceduresare needed:

• promptly notifying the offeror who was excluded from further awardconsideration because of not meeting the competitive range, and

• providing the basis (major weaknesses) for why the offeror was excluded.

FAR provides a Federal agency the ability to limit offerors responding to Request forProposals to those whose proposals meet minimum scores (competitive range) basedon technical evaluations by a procurement panel. The regulation requires a Federalagency to “promptly” notify offerors if their proposals do not meet the competitive rangeand include the basis for why the offeror was excluded. Job Corps applies therequirements of FAR and the Department of Labor Acquisitions Regulations (DOLAR)through the use of the Job Corps Procurement Compendium (Compendium). TheCompendium is used to assist Regional Office staff in properly documenting requiredprocurement decisions and activities by providing examples and models that can becustomized for each procurement. We found that although the Compendium doesinclude the requirement for notifying excluded offerors because of not meeting thecompetitive range, it does not include a reference to “prompt” notification. While theRegional Office notified the complainant/offeror that the company’s proposal did notmeet the competitive range, the notification was made 2 months after the proposal wasevaluated and a competitive range established. We concluded 2 months does not meetthe regulation’s intent for prompt notification.

The Compendium identifies the basis for exclusion that should be included in thenotification as “major weaknesses” in the proposal. The complainant/offeror’snotification did not have detail information that could be used to understand why theirproposal was not sufficient to meet the competitive range.





Recommendations

We recommend the National Director of Job Corps:1. Update the Job Corps Procurement Compendium to include the Federal Acquisition

Regulation requirement that the notice to offerors not meeting the competitive rangeis to be provided “promptly.”

2. Ensure the Regional Director of the Boston Regional Office of Job Corps issueswritten guidelines for the office to comply with the Federal Acquisition Regulationrequirement to promptly provide an offeror whose score did not meet the competitiverange the basis for why they were excluded from further consideration for a contract.

Agency Response

The National Director for the Office of Job Corps responded that the agency concurswith the first recommendation and will implement the recommendation. However, shestated that because contracting authority was being transferred from the Job CorpsRegional Directors to OASAM Contracting Officers, the second recommendation is nolonger applicable. She further stated that during scheduled training for the OASAMContracting Officers, the issues identified in this report will be emphasized.

OIG Conclusion

Based on the response, the recommendations are resolved. Although we continue toconsider the second recommendation applicable, it can be closed once the OIG isprovided evidence Regional Directors no longer have contract authority for awards toJob Corps center operators, outreach and admissions providers, and career transitionservice providers.




6 U.S. Department of Labor—Office of Inspector General Report Number: 26-06-002-01-370






U.S. Department of Labor Office of Inspector GeneralWashington, DC 20210

Assistant Inspector General’s Report

Ms. Esther JohnsonNational DirectorOffice of Job CorpsU. S. Department of Labor200 Constitution Avenue, N.W.Washington, DC 20210

Based on allegations included in a hotline complaint, the Office of Inspector General

(OIG) audited information related to the Boston Regional Office’s Request for Proposal(RFP) to operate three Puerto Rico (PR) Job Corps centers and outreach, admissions,and career transition services (O/A, CTS) for Puerto Rico and the Virgin Islands.The contract was awarded in January 2006, subsequent to the OIG receiving thecomplaint. The total value of the award was over $80 million, including three optionyears.

The following table presents each allegation and our conclusion on whether theallegation was substantiated.

ALLEGATION

AUDIT

CONCLUSION1. The Boston Regional Office Contracting Officer andContract Specialist were together with executives of theIncumbent Contractor’s (offeror) executives at all timesfrom May 3 through May 5, 2005 (Pre-Proposalconference and site visits) and traveled with theexecutives in the same vehicles.

Not substantiated

2. The Contracting Officer did not provide answers toquestions during the pre-proposal conference.

Not substantiated

3. The Contracting Officer and Contract Specialist did notprovide information requested by the complainant/

offeror that the complainant/offeror believed to bereleasable under FOIA.

Not substantiated





4. The complainant/offeror was not allowed anadministrative hearing (after the complainant/offeror’soffer was rejected) and information regarding the priceoffered by the competition was withheld from the

complainant/offeror.

Not substantiated

5. The Boston Regional Office did not provide thecomplainant/offeror an explanation of how thecompetitive range was established and informationabout the competitive range.

Not substantiated

The complainant/offeror also questioned whether former DOL Job Corps employeeswere working for the incumbent contractor/offeror. We did not find evidence of formerDOL Job Corps employees working for the incumbent contractor/offeror. Further, theRegional Office followed applicable procurement laws and regulations except for notpromptly providing the complainant/offeror details explaining why thecomplainant/offeror’s bid did not meet the competitive range, and, therefore, thecomplainant/offeror was no longer being considered for the contract.

Our audit scope, methodology, and criteria are detailed in Appendix B.

Objective 1 – Are the Allegations of Procurement Abuse Brought Against theBoston Regional Office Valid and Substantiated?

Results – Allegations that the Boston Regional Office Used Abusive Procurement

Practices Were Not Valid and Not Substantiated.Based on our determination that the five allegations brought against the BostonRegional Office of Job Corps are not valid and not substantiated, we found that theRegional Office did not use abusive procurement practices in the areas related to theallegations. The allegations and the results related to each allegation are presentedbelow.

a. The Boston Regional Office Contracting Officer and Contract Specialist weretogether with executives of the Incumbent Contractor’s (offeror) executives atall times from May 3 through May 5, 2005 (Pre-Proposal conference and sitevisits) and traveled with the executives in the same vehicles.

The allegation is not substantiated.

The allegation implies that the Contracting Officer and Contract Specialist separatedthemselves from other offerors, except executives of the incumbent contractor,during the 3 days of the pre-proposal conference and site visits, including travelingexclusively with executives of the incumbent contractor. The minutes of the pre-proposal conference and site visits included information that shows an overall





interaction by the Contracting officer and Contract Specialist with all participantsduring the conference and site visits. The Job Corps Procurement Compendium(Compendium), a Job Corps document that applies the FAR and Department ofLabor Acquisition Regulations (DOLAR) to assist Regional Office staff in properlydocumenting required procurement decisions and activities, requires the incumbent

contractor to provide logistics (transportation) for all participants at site visits duringthe procurement process.

The Contracting Officer told the auditors that the incumbent contractor was requiredto provide vans to transport those in attendance for one site visit and that anyprospective bidder could have ridden with anyone else involved in the walk-through.

We also found that the Contracting Officer and Contract Specialist rented their ownvehicle during the 3 days they were involved in the conference and site visits.

We concluded the Contracting Officer and Contract Specialist did not show

favoritism to the incumbent contractor during the pre-proposal conference and sitevisits by excluding other participants or traveling exclusively with the incumbentcontractor.

b. The Contracting Officer did not provide answers to questions during the pre-proposal conference.


Based on information obtained during the audit, we found the Regional Office policyfor questions on an RFP provides for written questions before the pre-proposalconference and questions and answers during the pre-proposal conference. Usinginformation provided by the complainant/offeror and official records maintained bythe Regional Office, we found questions asked before or during the pre-proposalconference were answered by contracting officials in accordance with their policyand instructions provided in the Request for Proposal.

The Compendium states that during the pre-proposal conference, answers to writtenquestions and answers to additional questions posed by the conference participantswill be provided. Although names of participants who asked questions are notincluded in the meeting minutes, we found the minutes of the pre-proposalconference did include questions by participants that were shown as answeredduring the conference.

We concluded the Contracting Officer did provide answers to questions asked duringthe pre-proposal conference.





c. The Contracting Officer and Contract Specialist did not provide informationrequested by the complainant/offeror that the complainant/offeror believed tobe releasable under FOIA.


In letters dated May 13, 2005, and June 1, 2005, the complainant/offeror requestedthe following information from the Contract Specialist:

1. Current salaries and positions (executive, administrative, skill and not skill,academic and vocational personnel) for the Puerto Rico and Virgin IslandJob Corps centers.

2. Fringe benefits currently paid to employees per center.

3. Organizational Chart per center

.4. List of subcontractors (including professional services) per center and cost ofcurrent contracts.

5. Incentive stipend currently paid per students and maximum stipend allowed(residential and nonresidential).

6. Puerto Rico Workforce Investment Plan Goals.

7. Current approved budget for the General and Administrative expenseaccounts for the three centers of Puerto Rico and the Virgin Islands.

The Contract Specialist sent a letter to the complainant/offeror dated May 20, 2005,responding to the requested information. Responses provided for each question areas follows:

• Contained in amendment 1 is the National Office Staff Compensation Reportwhich provides you with the common position titles and the salary ranges foreach position. It is incumbent upon the bidder to propose those positions thatthey feel will best lead to an efficient operation of the centers. The currentsalaries and positions located at the centers is not releasable, this informationis proprietary in nature to the current contract holder.

• As with question 1 this information is not releasable, this information isproprietary in nature to the current contract holder.

• As with the above two questions this information is proprietary in nature.

• This information is proprietary in nature to the current contract holder and assuch is not releasable.





• This information is located and available in the Job Corps RequirementsHandbook (PRH) in Chapter 5. A link is provided in the PRH, this link willallow you to download a copy of the current PRH.

•

Enclosed is a copy of the current Puerto Rico Workforce Investment PlanGoals.

Question 7 is from the complainant/offeror’s letter of June 1, 2005, and came afterthe response was provided by the Contract Specialist. However, we conclude therequested information would not be releasable based on the same proprietary rulesused for questions 1– 4.

The information shown as not releasable because of its proprietary nature isprotected from disclosure under rules included in the Job Corps Compendium. Forexample, under section 2.27, Freedom of Information Requests, the Contracting

Officer is not to make available to any person information protected from disclosureby the deliberative process privilege under FOIA Exemption 5. It also states that theContracting Officer is not to make available to any person information that is deemedto be proprietary. This section states that FOIA Exemption 5 covers informationused by the agency to make vital contractual decisions for the proper administrationof a center. The information requested relates to the incumbent contractor/offeror’spersonnel salary structure, company benefit policies, financial agreements withsubcontractors, and company internal management structure. The Boston RegionalOffice determined that this type of information is proprietary and, therefore, notsubject to public release.

Although FAR 15.201 encourages exchanges of information from the earliestidentification of a requirement through receipt of proposals, it states that suchexchanges of information must be consistent with procurement integrityrequirements of FAR 3.104. This FAR section includes a prohibition on disclosingsuch contractor information as bid, proposal, or source selection before the award ofa Federal agency procurement contract.

The Contracting Officer and Contract Specialist did not improperly withholdinformation from the complainant/offerors because the information requested wasnot releasable (under FOIA) in accordance with DOL and FAR guidelines.

d. The complainant/offeror was not allowed an administrative hearing (after thecomplainant/offeror’s offer was rejected) and information regarding the priceoffered by the competition was withheld from the complainant/offeror.


The Job Corps Compendium requires regional contracting officials to notifyofferors (in writing) when their bid does not meet the competitive range. In





addition, the notification should provide an explanation why the offeror’s biddid not meet the competitive range, and afford the offeror an opportunity for adebriefing. FAR 15.505 (c) allows the Contracting Officer to decide whetherthe debriefing will be oral or written. The complainant/offeror was notified onSeptember 14, 2005, that a telephone debriefing could be requested, either

pre-award or post-award. However, we did not find evidence in the contractfile that the complainant/offeror requested a debriefing.

FAR 15.306 d (2) provides for discussions with offerors who are within thecompetitive range in order to ensure the government’s best interest areserved. However, the complainant/offeror’s bid was not within the competitiverange, and as a result, we concluded a mandatory discussion with thecomplainant/offeror was not required.

The Regional Office properly withheld bids of other offerors from thecomplainant/offeror in compliance with FAR 3.104-3(a)(1). This FAR section

specifically prohibits the disclosure of bids or proposal information before theaward of a Federal agency procurement contract to which the informationrelates.

We concluded that the Regional Office followed the Compendium in providingthe complainant/ offeror an opportunity to discuss their proposal and properlywithheld bid information on other offerors from the complainant/offeror.

e. The Boston Regional Office did not provide the complainant/offeror anexplanation of how the competitive range was established and informationabout the competitive range.


Although the Regional Office did not provide the complainant/offeror anexplanation of how the competitive range was established or the actualcompetitive range that was established, this was not against the rulesprovided in the FAR or the Compendium. FAR 15.503 (a)(1) and Section2.12 of the Compendium require the Regional Office to provide an offeror whodid not meet the competitive range details explaining the basis for theexclusion. The Job Corps Compendium does not provide specific details ofwhat constitutes information that should be discussed in the notification, butrather states “major weaknesses found in the proposal of an unsuccessfulofferor” as an example of the details needed. The Job Corps CompendiumSection 2.27 states that information such as ratings used by the agency tomake vital contract decisions on the proper administration of centers isprotected from disclosure by FOIA Exemption 5. The competitive rangedetermination uses technical scores of all offerors and would, therefore, beexcluded from disclosure.





In addition, FAR 2.101 (5) and (7) cite technical evaluations of proposals andcompetitive range determinations that identify proposals that have areasonable chance of being selected for award of a contract as “sourceselection information.” FAR 3.104-3(a)(1) states that contractor bid orproposal information or source selection information shall not be disclosed

before the award of a Federal agency procurement contract.The Boston Regional Office was not required to provide the complainant/ offeror an explanation of how the competitive range was established or theactual competitive range that was used to award the contract. DOLguidelines do not identify “competitive range” information as releasable to anofferor.

Objective 2 – Are There Any Former DOL Job Corps Employees Working for theIncumbent Contractor/Offeror?

Results – Former Employees of Job Corps Are Not Working for the IncumbentContractor/Offeror for the Puerto Rico Job Corps Center

Based on our analysis of the staffing resources included in the incumbentcontractor/offeror’s proposal, we did not find evidence that former DOL Job Corpsemployees are working for the incumbent contractor/offeror. Boston Regional Officeofficials stated they did not know of any former DOL Job Corps employees who areworking for the incumbent contractor/offeror. In addition, the complainant/offeror couldnot provide any information that would provide evidence of this potential conflict ofinterest.

Objective 3 – Did the Boston Regional Office Comply with Applicable Laws andRegulations for the Procurement Included in the Hotline Complaint?

Results – The Boston Regional Office Followed Applicable Procurement Lawsand Regulations Except for Not Promptly Providing the Complainant/Offeror theBasis for Explaining Why the Complainant/Offeror’s Bid Did Not Meet theCompetitive Range and that the Complainant/Offeror Was No Longer BeingConsidered for the Puerto Rico Job Corps Contract

The Job Corps Compendium is designed to be used by Job Corps Regional Officepersonnel to apply the procurement policies and procedures included in the FAR andDOLAR. The Compendium is used by the Regional Office to ensure properprocurement of center operators and outreach and admission and career transitionservice providers.

The Compendium requires the Regional Office to notify offerors if their bid does notmeet the competitive range. In addition, Job Corps contracting officials are required to





provide offerors information explaining why their bid did not meet the competitive range.We found two issues with the notification process that did not comply with therequirements found in FAR. First, FAR requires a prompt notification to those notmeeting the competitive range and second there is a requirement to provide the basisfor why the offeror did not meet the competitive range.

We found that the Regional Office did not notify the complainant/offeror until 2 monthsafter the range was determined and it was documented that the offeror did not meet therequired competitive range. Although FAR did not provide a definition of what isconsidered a prompt notification, we believe 2 months would not satisfy the intent of therequirement. Moreover, the Compendium does not address the “prompt notification”requirement, even though it is included in the FAR.

The regional Contracting Officer stated that because of the large number of deficienciesin the complainant/offeror’s proposal, evidenced by the the complainant/offeror’s scoreof 26.16 out of a possible 100 points, to explain why the proposal did not meet the

competitive range would have taken too much time and would not have been aninefficient use of staff resources. However, by not following the requirements of FAR,the Regional Office did not ensure sufficient information was available to thecomplainant/offeror in a timely manner that could have been used to understand whythe complainant/offeror was excluded from participating further in a competition for afederally funded project.

While the outcome of this contract award would not have been affected by properlynotifying the complainant/offeror that the complainant/offeror’s proposal did not meet thecompetitive range, we believe the notification requirement will foster a competitiveoutsourcing environment for Job Corps services contracting. FAR expresses the needto work closely with both the winning and losing offerors. By providing prompt andmeaningful notifications to offerors whose proposals do not fall within the competitiverange, Job Corps can maintain more positive relationships with potential serviceproviders and ensure the competitive process will continue to provide the best value forthe government.

Recommendations:

We recommend the National Director of Job Corps:

1. Update the Job Corps Procurement Compendium to include the Federal AcquisitionRegulation requirement that the notice to offerors not meeting the competitive rangeis to be provided “promptly.”

2. Ensure the Regional Director of the Boston Regional Office of Job Corps issueswritten guidelines for the office to comply with the Federal Acquisition Regulationrequirement to promptly provide an offeror whose score did not meet the competitiverange the basis for why they were excluded from further consideration for a contract.





AGENCY RESPONSE

The National Director for the Office of Job Corps responded that the agency concurswith the first recommendation and will implement the recommendation. However, shestated that because contracting authority was being transferred from the Job Corps

Regional Directors to OASAM Contracting Officers, the second recommendation is nolonger applicable. She further stated that during scheduled training for the OASAMContracting Officers, the issues identified in this report will be emphasized.

OIG CONCLUSION

Based on the National Director’s response, the recommendations are resolved.Although we continue to consider the second recommendation applicable, it can beclosed once the OIG is provided evidence Regional Directors no longer have contractauthority for awards to Job Corps center operators, outreach and admissions providers,and career transition service providers.

Elliot P. LewisAugust 30, 2006





Appendices





APPENDIX ABACKGROUND

Job Corps is a national program carried out in partnership with states and communitiesto assist eligible youth who need and can benefit from an intensive program, operated ina group setting in residential and nonresidential centers, to become more responsible,employable and productive citizens. The Boston Regional Office oversees Job CorpsRegion I which trains and educates youth at 20 training facilities throughout theNortheast and in the Caribbean, including Puerto Rico and the Virgin Islands.

Center operators, outreach and admissions providers, and career transition serviceproviders are required to be selected in almost all cases based on a full and opencompetitive process. The procurement process for those services is administered byJob Corps Regional Offices using the procurement requirements found in FAR andDOLAR. The requirements of FAR and DOLAR have been included in the Job CorpsCompendium which is designed to assist Regional Office staff in properly documentingrequired procurement decisions and activities by providing examples and models thatcan be customized for each procurement.

The OIG received a complaint from one of the companies that proposed on the RFP tooperate three Puerto Rico Job Corps centers and provide outreach and admissions andcareer transition services for Puerto Rico and the Virgin Islands. Although the contractnoted in the allegation was not awarded when the complaint was received by the Officeof Inspector General, it was subsequently awarded in January, 2006. The total value ofthe contract for 5 years, including 3 option years, amounted to over $80 million.





APPENDIX BOBJECTIVES, SCOPE, METHODOLOGY, AND CRITERIA

ObjectivesOur audit objective was to determine whether the Boston Regional Office used abusiveprocurement practices in procuring an operator for three Puerto Rico Job Corps centersand outreach and admission and career transition services for Puerto Rico and theVirgin Islands as alleged in the complaint. In addition, we added an objective to answerthe complainant’s question of whether there are any former DOL Job Corps employeesworking for the incumbent contractor. As part of our work in determining whether theallegations were valid, we included an objective to determine whether the procurementof and contract with the winning offeror complied with applicable procurement laws andregulations.

ScopeOur audit covered the procurement time frame from the posting of the RFP April 21,2005, to the award of the contract on January 31, 2006. Our audit was limited toexamining the procurement for one contract; therefore, we did not consider the overallprocurement process in place and used by the Boston Regional Office for all contractshandled during the period covered. In addition, we did not consider all internal controlsin place at the Regional Office that would affect the overall operation of the RegionalOffice. Our consideration of internal control relates only to the policies and proceduresused by the Regional Office in the procurement of the Puerto Rico center operator andthe Puerto Rico and Virgin Islands outreach and admissions and career transitionservices. We performed our audit at the Regional Office of Job Corps in Boston,Massachusetts. Our audit was performed in accordance with Generally AcceptedGovernment Auditing Standards.

Methodology

To accomplish our audit objectives, we reviewed applicable criteria, including theprovisions on Federal Acquisition Regulation and the Job Corps ProcurementCompendium. We examined the official contract documentation for the subjectprocurement, other documentation related to travel by the Contracting Officer andContract Specialist and documentation provided by the complainant/offeror. We did nottravel to Puerto Rico but rather interviewed the complainant by telephone. Job CorpsRegional Office officials were interviewed onsite in the Boston Regional Office. Weexamined the contract subsequently awarded based on the procurement identified inthe hotline complaint. In determining the merits of the allegations, we used theassumption that the allegation would not be substantiated unless we found or wereprovided documented information that could be used as conclusive evidence of theRegional Office manipulation of the procurement process in violation of procurementlaws





and regulations. We did not use unsupported allegations by the complainant/offeror orstatements by Boston Regional Office personnel to determine whether a condition ofimproper procurement conduct existed or did not exist. In addition, in our considerationof whether former Job Corps employees are working for the incumbent contractor, we

determined this to refer to current employees of the incumbent contractor who had amanagement role and were involved in the proposal for the contract to which theallegations applied.

CriteriaWe used the following criteria to perform this audit:

• Federal Acquisition Regulation• Department of Labor Acquisition Regulations• Job Corps Procurement Compendium• Request for Proposal No.1-JC-05-PR





APPENDIX CACRONYMS AND ABBREVIATIONS

DOLAR Department of Labor Acquisition Regulations

FAR Federal Acquisition Regulation

FOIA Freedom of Information Act

JC Job Corps

OIG Office of Inspector General

OA/CTS Outreach and Admissions/Career Transition Services

PR Puerto RicoRFP Request for Proposal




APPENDIX DAGENCY RESPONSE TO DRAFT REPORT(Note: The draft report was issued under report number 26-06-001-01-370. Thefinal report is numbered 26-06-002-01-370.)

department of labor: 26-06-002-01-370

Documents